Trade Aptitude

Results of Tuesday’s Best S&P Futures Turning Points: Shorting 4575.00 was only good for a 5.25-point move before stopping and breaking out higher. 

Today’s Best S&P Futures Turning Points (consider wider stops and less size in fast moving markets): 

Buy 4577.75 stop 4573.50. Short 4631.50 stop 4637.00. 

The World Sentiment Index: (+100/-100) jumps from -7 to +29 in a world of mild Bullish leaning sentiment. 

Catalysts: Housing Starts @ 8:30. Crude Oil Inventories @ 10:30.  Corporate debt and bankruptcies are concerning… up 360% in the past two years according to Bloomberg. 

Quick Tip: Newbies Only Part 3

This is a multi-part process. If you didn’t read the prior two newsletters you can find them here. 

Yesterday you chose a time horizon to trade within and created a “calendar” with times blocked out for your trading tasks, research, execution, and review. 

It’s time to decide how much starting capital you’re contributing to your new “business.” This should be risk capital, meaning money you can afford to lose both financially and psychologically. 

Don’t fool yourself with this decision. Make believe you’re writing a check to your favorite charity. You may get nothing back. 

I frequently hear the question “How much capital do I need to start trading?” Different styles and different trading vehicles will require different capitalizations. But that’s getting ahead of ourselves. 

You can start trading with a few thousand dollars, maybe less, and any amount more. It’s not about the amount, it’s about how you would feel and react if you lost it all. 

Trading is more psychological than mathematical. If you start with money you cannot afford to lose, you’ll become emotional over every trade result. No good. You want to trade with confidence, not emotions. 

Before you get scared away by all this losing talk, know that before you ever trade with real money you’ll practice in a simulated account until you feel confident in your plan and skill level. 

Another good decision to make now is how much you’re willing to add to your account later. Let’s say you’re starting with $5000, and you experience a losing streak. Will you add any more risk capital to the account? How much? What about a winning streak? Will you add more capital then? Think about it. 

Tomorrow we’ll dive into the different markets to find your perfect fit. 

if you want help getting through the process from a team of skilled traders, join ours, learn several strategies, and watch us trade live daily.  Money back if you’re not blown away! Click here for details. 

Trade Fearlessly,

Mike Siewruk